Good news is on the way for millions of American families! A new law has been passed that brings bigger tax cuts, larger child tax credits, and direct cash payments through stimulus checks. These changes are part of the Fiscal Year 2026 Budget, signed by New York Governor Kathy Hochul, aiming to give families a much-needed financial break as the cost of living continues to rise.
Let’s look at how this plan will benefit you, who is eligible, and when the money will arrive.
What’s in the New Legislation?
The new financial support package includes:
- Expanded Child Tax Credit
- Historic tax cuts
- Inflation rebate checks
- Free school meals for all
- Lower payroll withholdings
This package is designed mainly for middle-class families who are finding it harder to keep up with rising prices on food, housing, and healthcare. According to the plan, a family of five could get up to $5,000 per year in total relief.
Bigger Child Tax Credit from 2025
One of the biggest highlights is the tripling of the Child Tax Credit starting in 2025. The new rules will help around 1.6 million families in New York. Here’s how it breaks down:
- Children under age 4: Families get $1,000 per child every year
- Children between 4 and 16: Families get $500 per child every year
Even families earning up to $170,000 annually will now be eligible for some benefit. For example, a family of four making $110,000 a year could receive $1,500, which is almost $1,000 more than previous years.
This change is expected to support 187,000 additional children and reduce child poverty by 8.2%, and up to 17.7% when combined with other childcare programs.
Major Tax Reductions: What You’ll Save
This new law also comes with historic tax cuts, which means more money in your pocket:
- Over 75% of taxpayers in New York will see lower state taxes
- Families with joint incomes up to $323,000 will benefit
- Total tax relief will reach $1 billion per year
- These will be the lowest tax rates in 70 years
These tax cuts are aimed mainly at the middle class, helping those who are struggling with high costs in housing, health, and transportation. No tax hikes are planned for the wealthiest residents.
Less Payroll Deduction Starting in 2026
Starting in 2026, most workers (about 80%) will notice a drop in payroll deductions. This means more money will stay in your take-home pay every month. Once this policy is fully applied, 3 out of 4 people will save hundreds of dollars each year without doing anything extra.
Inflation Rebates: Cash for Over 8 Million Homes
To fight the effects of inflation, New York State is giving out $2 billion in rebate checks. These payments will be automatic—no need to apply or fill extra forms. Just make sure you file your 2026 tax return and that no one else claims you as a dependent.
Here’s how much you can expect:
Couples filing jointly:
- Income up to $150,000: $400 rebate
- Income between $150,000–$300,000: $300 rebate
Individual filers:
- Income up to $75,000: $200 rebate
- Income between $75,000–$150,000: $150 rebate
How and When Will You Get Paid?
All these benefits will start rolling out with the 2025 and 2026 tax years. Stimulus and rebate checks will be sent out automatically by the end of 2026, as long as you have filed your state tax return and meet the income rules.
There’s no need for extra paperwork or online applications. The process is designed to be simple and automatic.
This new legislation brings real relief to millions of American families, especially those in New York. With higher child tax credits, tax cuts, and direct stimulus payments, families will find it easier to cope with inflation and rising expenses. It’s a big step towards financial stability for the middle class and a brighter future for children. Make sure to file your taxes, check your eligibility, and stay informed to get the most out of these new benefits.
What about us seniors that are trying to keep up with costs and struggling while in their homes in N Y.